The role of incapacity benefit reassessment in helping claimants into employment - Work and Pensions Committee Contents

Written evidence submitted by Professor
Paul Gregg

In 2008 the previous Labour government introduced
a new benefit for the sick and disabled called the Employment
Support Allowance (ESA). The new benefit replaced two existing
benefits for new claims on its introduction but at its heart were
two major differences. First, was a new test called the Work Capability
Assessment (WCA), to determine eligibility for the benefit and
for the majority of claimants, called the Work Related Activity
Group (WRAG) there was to be a new regime of personalised support
and engagement to help people back to work (which I designed).
The new regime initially applied only to new claimants but this
week existing claimants are starting to be re-tested under the
new WCA test and may potentially be reclassified as Fit for Work.

There are two major reasons why getting this transition
process right is critical. First, this is a large and vulnerable
group and thus the introduction of the new benefit eligibility
test has the potential to cause huge anxiety and distress to people.
Many, especially those with mental health problems, may well fall
into the sizable crack between ESA and JSA (unemployment benefit)
and end up destitute, homeless or worse. Second, those denied
access to the benefit are likely to end up on unemployment benefits
which are not designed to help sick people back to work. Under
the new Work Programme providers are paid to get claimants into
sustained work are divided into three groups, the first are mainly
adult unemployed who receive help after 12 months claiming benefits.
Here the payment to a provider for getting them into work for
a year will be of the order of £3,500. Those "being
found fit for work" and hence signing on as unemployed rather
than disabled will normally be allocated to this group, although
if they were previously claiming Incapacity Benefit they will
get the help after three months. For those on ESA the package
of support starts immediately and providers will be paid about
£14,000 if they get someone into work for two years. Getting
the sick and disabled in the right category thus matters greatly
in terms of the chances of helping them into work. Those on unemployment
benefits with significant barriers to work may well be ignored
by providers as offering little hope of a pay off given the high
investment needed to get them back to work.

Given the imperative of getting people into the right
category, common sense would suggest the Government should move
slowly and check at each stage that any changes were working.
So starting with new claimants makes sense and a five year review
process was specified in the original legislation I believe. Yet
the developments so far have been deeply flawed. Concerns with
the WCA test emerged in late 2009-early 2010 with strong reports
of major problems, especially around individuals with cancer,
mental health problems and variable conditions. It also emerged
that a huge number of cases were going to appeal, jamming the
system, and often being overturned. The Government responded with
changes to address these issues, but there were no subsequent
checks that the problems had been dealt with. In fact, the cries
of anguish continued unabated. In the summer of 2010, Prof. Malcolm
Harrington was commissioned to undertake the first major review
and it was quickly apparent that he saw the need for extensive
changes to the process of the decision making after the test was
undertaken. Furthermore, the DWP was also internally reviewing
the medical test. Yet the first trial of the WCA test on existing
disability claimants went ahead in Burnley and Aberdeen on the
old test and the old decision process. So now as the medical test
goes national the new regime outlined by Harrington and the DWP
internal review is being implemented with no prior testing. The
Government claims these changes have fixed the earlier problem
and undoubtedly the Harrington Review will have made a difference,
but surely it should be tested and checked before being applied
nationally. It is baffling why the trials in Burnley and Aberdeen
were not delayed just four months to test run the new regime.
Likewise it is clearly essential to track the progress of those
denied access to the new benefit, especially among those previously
claiming Incapacity Benefits, to study what is happening to them.
Are they moving to JSA, getting jobs or suffering acute deprivation
without any financial support? By tracking people according to
what conditions they are presenting with, we can assess which
conditions are not being picked up well, if groups fail to move
into work. But again no such research or tracking is apparently
being undertaken.

The process seems to have been characterised by undue
haste, a lack of testing and immediate assessment. It may be that
this derives from a view that those denied benefit will be healthy
and undeserving of support, rather than emphasising the risk of
vulnerable people being treated inappropriately. This has become
an interactive process of changes being followed by a chorus of
complaints, revision, a wait to see if complaints diminish, and
further revision when they don't. The current national roll out
will not be the end regime but just the latest iteration in my
view. This is no way to introduce such a fundamental reform affecting
so many vulnerable people.